The Trump-Xi meeting in Argentina revived the possibility that China would buy more US energy and agricultural products by March 1. This development coincides with seasonal anti-pollution controls in China, which last winter caused a natural gas shortage as households and factories were forced to replace coal. Wintertime coal conversions are in effect in new places, but policy mandates on gas use are marginally more relaxed and Chinese authorities appear better prepared, suggesting a repeat of last year’s gas shortage is unlikely. Limited storage capacity—rather than rising consumption or supply controls—remains the key risk to rising prices, should winter weather surprise.
